Does anyone else feel priced out? Singles? (Magnolia: how much, townhome)

[Anigirli]

Nova I am a single girl in my 20's. I was discourage by my family, the re agent and the banks as to not buy the delapilated Victorian home because many felt it was to overwhelming for a nice girl to do all by herself. And I still think about it to this day because it was the type of home I would of loved to have grown old in.

Cooper yes I agree that it's hurting the local first time home buyers in NC. When I look at the numbers this is happening all over the country and its the very reason why people are leaving astronomicaly priced cities because they were priced out of their own home state. NYC and LA feels like Seems that the middle class is getting smaller and smaller across the country.

[heavyweight]

Originally Posted by NOVA2

SIGHHHHH.

Does anyone else feel priced out of this ridiculously rising housing market?...
I know this is laughable to many, especially those who can afford more expensive, median priced homes in the $200k's but...
I don't need a McMansion. I don't want a TH but I feel I have to compromise with the wall sharing and tight feel of TH communities. Argh. I just want a decent home that's not in the woods, that's not a rancher, that's not in a funky (as in gross) neighborhood.
Can I just get some love from others who are feeling the squeeze?...

I'm 20something, single and feel your pain, NOVA2. I think one of the responses you received was from a 40something single who owns near DC. I don't think that's relevant to your situation since: 1. the age indicates 20+ years of working and wealth building 2. Owning in DC during unprecedented housing appreciation indicates the opportunity to build equity quickly.

Being single simply limits purchasing power in all things, not just home purchases. It also limits ability to build long term wealth. Imagine saving 30% of a $120k combined income versus a $60k single income. The effects of earning compounding interest on twice as much money have got to be ......sweet.

Married persons that can't relate make ignorant comments like, "Why don't you buy a house?"...or "Why live in a condo with no privacy?"

People who purchased homes 20 years ago don't get it either. Salaries haven't kept pace with home appreciation in most markets. Buying a home now is not comparable to, "I bought my first home back in 19XX and paid less than $100k for it....you have to start somewhere."

I own a condo downtown in a large metro area. Fortunately, appreciation has been steady, I secured a 30 year fixed mortgage, my salary has increased 50% in the 6 years since I've been out of school, and I found great tenants to cover my mortgage when I was forced to relocate for work. On the reverse, I have two friends who purchased just to "get into the market" with a place valued at 2 times their salary or whatever the rule of thumb at the time. They secured ARMS to be able to afford something on their single salaries, and both foreclosed 3 years later.

I'm relocating to NC for work and would love to find a nice SFH. As a single person though, if I lost my tenants or my job I'd be SOL without a partner's salary to back me up. I'm an adult that doesn't live in Manhattan, which means I'm too grown-up for a roommate. Plus, I'd have way too much debt for my income level.

As a single person, there's no safety income to sustain a surprise assessment, lost job, adjustable rate increase, or accident. If you decide to "get into the market", make sure you've put away 3-6 months' living expenses for contingencies. Just try not to get caught up in feeling like you're entitled to something only because it appears the masses can afford it. When it's your turn, you'll take the plunge and be prepared to accept all the risks and rewards that come with it... all by your little old self. I made that decision, in the 21st century, in a huge metro area, and it was scary as hell.

I get it. It sucks to not be able to afford the living conditions you want in the location you want, when you see others buying what they want.

[MikeJaquish]

I get it. It sucks to not be able to afford the living conditions you want in the location you want, when you see everyone else buying exactly what they want.

Callsnap,
Your concerns have some merit.
Then again, it has never been easy. The folks who bought 20 years ago likely paid double-digit interest rates on their entire mortgage. And probably had to have 20% down, unless going FHA, VA, etc.

Gosh, does "...everyone else..." mean I have exactly what I want? That would be inaccurate. I can't say I do, and I know too many people who don't.

Homeownership is NOT necessarily a matter of having exactly what you want. It is about deciding to invest in your domicile, making the best of it, and reaping the benefits of that investment.
I can lay down restrictive parameters that would preclude me from homeownership as well as the next person. Where would that get me?

I see where NOVA2 said, "...not a rancher..." Where does that come from? The amortization, appreciation, and tax advantages of homeownership do not discriminate between ranchers and Big Hair Houses.
I would own a small split-level ranch from 1972 before I bought a home for a landlord. But that is just me. Unfortunately, some folks settle for nothing because they can't have everything.

If income is an issue, and very bad credit is not an over-riding fact, there are truly great public and private loan programs out there to help responsible folks get into a home.

[adlnc07]

Thanks, Mike.

I did buy 20 years ago, when I was 24 years old - and no it wasn't easy. My interest rate was 9 7/8ths. I bought a 500sf condo that was renovated postwar housing for $62.5K using a FHA/VHDA loan (low downpayment, FHA insured). I don't remember exactly how much I was making at the time, but I think it was around $30-35K in my full-time job. I also worked part-time at a grocery store for 2 years. The condo was a *BAD* investment - 10 years later I sold it for 1K more than I paid.

My next house was a townhouse - also purchased via a special loan program. It was a really ugly 30 year old townhouse that had been a rental for 10 years. For the next 5 years I put everything I could into fixing it up. When I did sell it, I made enough profit to put 20% down on a single family (finally), and had enough money left to fix THAT house up. For 17 years I was a homeowner with normal (or worse than normal) appreciation, and yeah I made out the last 3 years.

I went through a lot over the years as a single person owning real estate, relying only on myself (including going to court to evict bad tenants). Forgive me if I don't 'boo hoo' over the fact that a 20-something can't buy a single-family house right off the bat, and might have to settle for a condo, TH or roommate instead.

edit: Oh, and I don't think any of the homes I've owned were "exactly" what I wanted - they met my needs, and I could afford them.

[heavyweight]

Originally Posted by MikeJaquish

.....
Callsnap,
Your concerns have some merit.
Then again, it has never been easy. The folks who bought 20 years ago likely paid double-digit interest rates on their entire mortgage. And probably had to have 20% down, unless going FHA, VA, etc.

Point taken. If we're going to take things verbatim, I never said buying a home 20 years ago was easy. I simply disagree that it's a direct correlation. Also, the ability to secure a mortgage with no down payment and low interest rates doesn't mean one can afford a home. It means one can "get into the market". We can reference cnnmoney for rising forclosure rates, to understand "getting into" a home doesn't equate to affording one.

Originally Posted by MikeJaquish

Gosh, does "...everyone else..." mean I have exactly what I want? That would be inaccurate. I can't say I do, and I know too many people who don't.

Homeownership is NOT necessarily a matter of having exactly what you want. It is about deciding to invest in your domicile, making the best of it, and reaping the benefits of that investment.

I was using a hyperbole to reflect the perception someone might have, when watching HGTV, reading the WSJ or paying any attention to the media. When you've never been a homeowner, you are young, and want to become a homeowner; it can seem as though everyone else is buying the home of their dreams and you are excluded.

Agreed. As I stated, I'm a homeowner. Most of us do not get exactly what we wanted when we purchased. We did get what we wanted though......otherwise, we wouldn't have purchased. A reasonable person doesn't spend thousands on a purchase they don't want or aren't largely satisfied with. If their initial perception of value was overstated or market forces changed for the worse, that doesn't change the fact that someone buys what they want at the time.

To stay on topic, I agree with the OP. It's tougher to afford an SFH as a young single person than a young married person in today's market. If folks can rant about gas prices, taxes, education, immigration, insensitive significant others, and messy divorces....this topic certainly has a place on the boards. And the beat goes on.....

[MikeJaquish]

Good discussion.
OTOH, it is very difficult to have sympathy with someone who fits the following description:

"I was using a hyperbole to reflect the perception someone might have, when watching HGTV and reading the WSJ or paying any attention to the media. When you've never been a homeowner, you are young, and wanting to become a homeowner, it can seem as though everyone else is buying the home of their dreams and you are excluded."

Just had House Hunters running on HGTV. It is a terrible program, but well illustrates the compromises all Buyers must make. ALL Buyers.

I have tenants who pay $725/month on a condo.
They could buy one for about $655/month, including PITI and HOA fees, if they got the 100% financing from a community loan. Then they could take the $70/month, bank it to build a safety net.
Truthfully, they have outgrown it, with two kids, and need a 3 BR home. Probably cost them about $910/month, PITI and HOA. Maybe less.
Shangri-la? No. Realistic? Maybe.

Four necessities: Food. Shelter. Clothing. Medicine. Expenses get out of hand when ego interferes with necessity, budgeting, and common sense.
That's when folks of any age start digging a hole.

[heavyweight]

Originally Posted by MikeJaquish

Good discussion.
OTOH, it is very difficult to have sympathy with someone who fits the following description:

"I was using a hyperbole to reflect the perception someone might have, when watching HGTV and reading the WSJ or paying any attention to the media. When you've never been a homeowner, you are young, and wanting to
become a homeowner, it can seem as though everyone else is buying the home of their dreams and you are excluded."

Originally Posted by NOVA2

SIGHHHHH.
Does anyone else feel priced out of this ridiculously rising housing market?
Can I just get some love from others who are feeling the squeeze?
Just venting. (I don't expect some mysterious housing genie to appear and help me/us out.) Crawling back to corner...

The title of my post was, "I'll Take a Moment to Commiserate (with the OP)", not: I'd Like to Solicit Sympathy. The perspective of a tenured, local real estate agent is naturally going to differ from 20's single transplants. Both are valid. Should I choose to empathize with someone in my peer group, that doesn't equate to a request for "all hands on deck" to join me. I think the OP simply wanted to "rant" and get feedback from those who are in a similar situation (i.e. stage in life). This is only how I interpreted her post.

That's why I gave a bit of advice from more recent and potentially relevant experience.

Originally Posted by MikeJaquish

Good discussion
Four necessities: Food. Shelter. Clothing. Medicine. Expenses get out of hand when ego interferes with necessity, budgeting, and common sense.
That's when folks of any age start digging a hole.

Agreed! That's precisely why I shared my experiences regarding:

1. Taking a calculated risk and succeeding:

Originally Posted by callsnap

I own a condo downtown in a large metro area. Fortunately, appreciation has been steady, I secured a 30 year fixed mortgage, my salary has increased 50% in the 6 years since I've been out of school, and I found great tenants to cover my mortgage when I was forced to relocate for work.

2. Taking a risk and failing:

Originally Posted by callsnap

On the reverse, I have two friends who purchased just to "get into the market" with a place valued at 2 times their salary or whatever the rule of thumb at the time. They secured ARMS to be able to afford something on their single salaries, and both foreclosed 3 years later.

3. and ...Exercising prudence (common sense over ego):

Originally Posted by callsnap

I'm relocating to NC for work and would love to find a nice SFH. As a single person though, if I lost my tenants or my job I'd be SOL without a partner's salary to back me up. I'm an adult that doesn't live in Manhattan, which means I'm too grown-up for a roommate. Plus, I'd have way too much debt for my income level.

As a single person, there's no safety income to sustain a surprise assessment, lost job, adjustable rate increase, or accident. If you decide to "get into the market", make sure you've put away 3-6 months' living expenses for contingencies. Just try not to get caught up in feeling like you're entitled to something only because it appears the masses can afford it. When it's your turn, you'll take the plunge and be prepared to accept all the risks and rewards that come with it...

I both identify and empathize with the OP's current situation, whereas some may not.

[Sugar Magnolia]

I'm not single and I couldn't afford to purchase the house that we have on my own (my boyfriend could however). It was just due to the careers we both chose, mine is lower paying. However, if I were alone I would still buy something, anything. That is just me. I have wanted to purchase my own home since I was a kid. It is just the way my family raised me. My dad was big into real estate and read a ton of books and I guess passed that on to me. If all of a sudden my boyfriend and I split and I moved out, I'd find a cute little townhouse or condo somewhere to make my own. No, it wouldn't be ideal or exactly what I want, but it would be a start and I could move forward from there. Just my thoughts.

Also, I'm not exactly sure what you are looking for but I wonder how much you are willing to compromise. We found a great home with 4 bedrooms and over an acre of land with a two car garage for around $188k. Granted it is in Youngsville and a lot of people don't want to move "that far out" for whatever their personal reasons are. We don't mind it much, actually we like being away from the city. But both of us were willing to compromise, I on the land and he on the garage, but it turned out that we didn't have to.

All I am saying is that no, a townhouse might not be exactly what you want right now, and the thought of a roommate might not make you feel all warm and fuzzy, but look at where it could lead in as little as 2 or 3 years. You could turn around and sell then and take your money and get something more your style.

In any event, good luck, I know there are homes out there because we only moved a couple of weeks ago, so it hasn't been that long since I was in your shoes.

[MikeJaquish]

"Should I choose to empathize with someone in my peer group, that doesn't equate to a request for "all hands on deck" to join me. I think the OP simply wanted to "rant" and get feedback from those who are in a similar situation (i.e. stage in life). This is only how I interpreted her post. "

I think you are probably right. My bad.
I missed the rant part and only considered the topic from the standpoint of personal finances, classic housing market realities, and realistic problem solving that know no age boundaries.

[alice_61]

Back in the 50's a single person's income could pay for a "starter" detached home. It was probably <1000 sqft and 2 bedrooms/1 bath. A single person could still probably afford such a home in the Triangle. An average couple in Long Island on Northern Virginia with two incomes would have to stretch to afford such a home. My point is that this area is better for home ownership but, still having one income and limited savings reduces your choices. It might help to remember what you need vs. what you want. BTW, we are a couple with a child and we bought one of those older small ranches because that is what we can afford.